Situated in coastal India, Kochi is the focal point of Kerala’s commercial activity. The steady economic growth within the city also implies an increase in the number of individuals who prefer not to rely on public transportation to get around the city. While owning a car might be on almost everyone’s list of big purchases, there are many instances where it might not be affordable. When there are a number of financing options available, how do you decide on one that would be most suitable for you? If you are a resident of Kochi, you have a host of financing options to choose from.
|Bank||Interest rates||Minimum income||Processing fee|
|State Bank of India||9.25% - 9.75%||Rs.2.5 lakh p.a.||Up to Rs.1,000 + GST Nil up to 30 April 2019|
|Axis Bank||9.25% - 11.50%||Rs.2.4 lakh p.a.||Rs.3,500 – Rs.5,500|
|Federal Bank||9.15%||Rs.2.4 lakh p.a.|
|HDFC Bank||9.75% - 10.60%||Rs.3 lakh p.a.||Rs.3,000 – Rs.10,000|
|ICICI Bank||8.89% to 14.50%||Based on lender’s terms||Rs.3,500 – Rs.15,000|
|IDBI Bank||9.30% - 9.90%||Rs.2.4 lakh p.a.||Rs.1,000 + taxes|
|Syndicate Bank||9.1% - 9.35%||Rs.2 lakh p.a.||Rs.1.25 per Rs.1,000 of loan amount to Rs.200 per lakh|
|Punjab National Bank||8.50% - 8.95%||Rs.2 lakh p.a.||Rs.1,000 to Rs.1,500|
|Bank of India||9.5%||Based on lender’s terms||Rs.500|
|Bank of Baroda||8.90% onwards||Based on lender’s terms||Rs.1,000 + GST to Rs.2,500 +GST|
Before applying for a car loan, checking your credit score can help assess the loan amount and the interest rate that you are likely to be charged. Generally, banks offer better interest rates and higher loan amounts to customers who have good credit scores and repayment history.
Before applying for a loan, it is advisable to choose a car dealer that has a tie-up with your bank. If the dealer that you choose has a relationship with your bank, you may be able to receive better rates on your loan in addition to a few perks and discounts. Most banks will have a list of car dealers that they are partnered with so you can have a clearer picture of the rates and charges before you apply for a loan.
Some banks determine your car’s eligibility criteria and loan amount based on the model that you choose. The age of the car, the model, and the year of manufacture are taken into consideration when determining eligibility criteria. Banks usually take into account the car model when determining the interest rate.
When looking for financing for a car, it is always better to choose a bank that you have an existing relationship with. This ensures that you can get the best interest rates when compared to a loan that is availed from a bank where you do not have an account.
The interest rates charged on car loans vary based on the loan tenures chosen. The longer the loan tenure, the higher the amount paid in interest. Therefore, it is advisable to choose a loan tenure that is shorter in order to save on the amount paid in interest.
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In order to apply for a car loan in Kochi, you have to meet the following criteria. The list below might vary across lenders:
|Age||21 years||21 years|
|Income||Rs.2 lakh to 2.4 lakh p.a.||Rs.1.8 lakh to Rs.2 lakh p.a.|
|Employment experience||1 year of continuous employment||3 years of continuous employment|
Most lenders offer up to 90% of the car’s price as the loan amount. However, there are a number of lenders that also offer 100% financing for a car. The amount for which you are eligible will also depend on the cost of the car, the model, and year of manufacture.
A loan application is usually rejected when your credit score and credit history are not in line with the lender’s requirements.
The maximum repayment tenure for a car loan is typically 7 years.
Yes, interest rates on car loans can be negotiated provided the lender offers car loans on a floating interest rate.
The time taken for a loan application to be processed is subject to the verification of the documents submitted. This usually takes anywhere between 3 and 7 business days.
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